Terra Classic (LUNC) Plummets 7% After Scandal with Crypto.com

In a decision that stirred up the crypto community, cryptocurrency exchange Crypto.com announced the suspension of Terra Luna Classic (LUNC) trading. Through an email sent to U.S. residents, Crypto.com urges customers to sell or withdraw their LUNC tokens before February 15. This move resulted in a significant drop for the token, with a decrease of over 7.1% in the last 24 hours.

The news was initially disclosed by Danny Demi DeFi, who shared a screenshot of the email sent by the Crypto.com team. Although no official statement is available on the platform’s website, many members of Terra Classic in the United States confirmed receiving the same email.

3-D is being a lot more calm nowadays… yesterday when he helped sound the alarm on the @cryptocom situation, many were calling him a bad actor or refusing to believe reality… pretty hilarious actually…

-So Anyways… normally would have 10 memes on my opponent by now……

— 🧩😜Danny Demi DeFi | Moon Rabbit Validator (@danny_demi_defi) January 19, 2024

In response to the events, both tokens associated with Terra Classic experienced a noticeable decline. LUNC, after a 7.1% deficit in the last 24 hours, dropped out of the top 100 by global market capitalization. Its current trading value is $0.0001107, reflecting a monthly decrease of 34.48%.

Simultaneously, the stablecoin USTC experienced a 10.2% decline in the last 24 hours, currently trading at $0.02732, according to CoinMarketCap. USTC had a bullish run reaching 7 cents in November 2023, but later retraced those gains. Over the last 30 days, the coin has fallen by 21.68%.

The Fluctuations in Terra are Partly Due to Legal Proceedings

Price movements of the tokens are closely tied to legal developments, especially the TerraForm Labs vs. U.S. Securities and Exchange Commission (SEC) lawsuit. Last week, USTC saw an 8% increase after SEC Chairman Gary Gensler postponed the trial, initially scheduled for January, due to the imprisonment of TerraForm Labs founder Do Kwon for document forgery in Montenegro.

Amidst the events, several LUNC holders requested clarifications from Crypto.com. Some speculated that the emails could be fraudulent. However, as of now, Crypto.com’s official support has not responded to requests for comments on Twitter.

The Terra ecosystem faced challenges in May 2022 when the USTC stablecoin decoupled from $1. As the remaining community strives to recover, support from exchanges becomes crucial. The delisting by Crypto.com highlights the impact of such decisions on the price and market position of associated tokens, causing concerns and reactions within the community.

Source